By Al Labita
NOTHING to crow about the Aquino government’s self-serving claim that under its watch, the economy has expanded at a rate faster than what its officials could imagine.
Reckoned with realities, however, the growth only perpetuated the perennial rich-poor gap, one of the world’s worst, despite Aquino’s much-ballyhooed reform agenda.
While statistics only tell half a story, they nonetheless betray the painful truths lurking behind a façade of lies and deceit.
The inclusive growth Aquino has been harping on has been largely inclusive only among the few moneyed elite to the exclusion of the vast majority – the poor.
As the economy grows, it also exponentially drives up the wealth of those in command and control of the lives of Filipinos.
The figures are grim — only 40 families such as the Ayalas, Sys and Tans account for nearly 80 percent of the economy as measured by gross domestic product (GDP), an OpinYon’s research shows.
In stark contrast, some Asian neighbors had managed to whittle down the rich-poor ratio as they gained headway in democratizing their economy over the past decades.
In Thailand, the same number of families account for only 33.7 per cent of the economy and in Malaysia, 5.6 per cent, indicating how the Philippines has lagged behind in addressing the urgency to spread out the nation’s wealth.
Ironically, the glaring disparity vis-à-vis sharing a nation’s wealth explains why the Philippines has more billionaires (in US dollar) than in more prosperous Thailand and Malaysia.
GDP and PPP
They are the same people who take advantage of lucrative contracts, including profit guarantees and tariff increases, under the government’s Public-Private Partnership program (PPP), Aquino’s centerpiece in pushing infrastructure projects.
“The regime has consistently favored the few billionaires while further marginalizing the poor. Aquino now wants to enrich them even more by giving them various perks for the PPP projects,” says the militant Bayan Muna in a statement.
Based on the account of US-based magazine Forbes, the combined net worth of the Philippines’ 50 richest totaled US$65.8 billion in 2012, more than a quarter of the nation’s GDP.
Mostly of Chinese origin, these families own companies which have grown—aided largely by generous government incentives—to become conglomerates with shares traded on the Philippine Stock Exchange and in some cases offshore, notably in cash-rich Hong Kong and Singapore.
Millionaires to Billionaires
Their vast and diverse corporate tentacles extend far and wide, catering to the lives of Filipinos, literally from womb to tomb, leaving them with no choice but to enslave themselves under the weight of an oppressive western-style economic system.
As shown in the list of Singapore-based UBS Billionaires Census 2013, the Philippines ranked 9th in Asia, with 13 billionaires with a combined net worth of US$35 billion.
In 10th place was Malaysia with 10 billionaires worth a combined US$37 billion, while Thailand ranked 11th with 10 billionaires worth US$25 billion.
As usual, ethnic Chinese taipans Henry Sy and Lucio Tan topped the list of the Philippines’ mega rich whose ranks had swelled as more of their kind continued to amass wealth at the expense of those marginalized by the government’s pro-rich, anti-poor economic policies.
Sy, who operates shopping malls, saw his assets surge 44 percent to US$7.2 billion in 2012 alone and remains the Philippines’ richest man.
According to the Forbes 2012 annual rich list, Sy and Tan whose businesses range from retail to property and other related ventures were worth a combined US$13.6 billion, equivalent to six per cent of the Philippine economy.
While GDP has undoubtedly risen over the past years, every Filipino’s share of it is unfortunately the lowest among Asean countries.
Based on the latest data of the National Statistical Coordination Board (NSCB), the Philippines’ per capita GDP) stood at only US$4,339 in 2012 compared with Singapore, $61,461; – Malaysia, $16,976; Thailand, $9,609; and – Indonesia. $4,971.
GDP is the amount of goods and services produced, while per capita is derived from dividing the population in relation to GDP.
While seemingly doubtful, the NSCB data hardly reconcile with Aquino government’s oft-repeated claims that GDP last year expanded by 6.8 percent and even bragged that it outpaced Singapore’s 1.3 percent, Malaysia’s 5.6 percent, Thailand’s 6.5 percent and Indonesia’s 6.2 percent.
Yet, the Philippines’ per capital GDP has been the lowest–and slowest—among its peer group since 2005 despite official claims that it is Asia’s fastest-growing economy.
In what could be an indicator of the country’s ever-widening rich-poor gap, NSCB data also showed that high-income households accounted for more than half, or 60 percent, of the GDP.
The balance of 40 percent of the economy’s income was shared by the bulk, or about 84 percent, of the country’s population.
To be poor meant earning less than 16,800 pesos a year or P1, 400 a month or P47 pesos a day which covers 26.5 per cent of the nearly 100 million Filipinos.
As gleaned from the official poverty data of NSCB, the proportion of poor Filipinos to the total population has been surging from 24.9 per cent in 2003 to 26.4 per cent in 2006, and 26.5 per cent in 2009, an issue Aquino promised to address under his “Daang Matuwid” program of government.
The Philippines has one of the highest poverty rates among emerging Asian economies. The poverty incidence stood at 27.9 percent as of the first semester of 2012, almost unchanged from the 28.6 percent in 2009.
Aware of the magnitude of the problem, the government wants to bring down poverty incidence to 16.6 percent by 2015, an ambitious target difficult to achieve as the rich get richer and the poor poorer, given the economy’s bias for the affluent and the powerful.
In more ways than one, the economy is basically lopsided in structure allowing the oligarchs to gain too much control of the country’s resources and creating one of the worst income inequalities in Asia.
One wonders whatever happened to Aquino’s oft-repeated term “inclusive growth” which seeks to create jobs and reduce poverty by spreading the economy’s gains to trickle down to lower-income segments of society.
More importantly, the rich-poor disparity also draws attention to Aquino’s anti-poverty conditional cash transfer program which has a budget of more than P40 billion this year.
Capitalist vs. Socialist System
The program seeks to see 15 million of the nation’s poorest people receive money directly in exchange for their kids going to school and mothers and children getting proper healthcare.
In releasing its data, NSCB risked incurring anew the ire of Aquino who once bawled out the agency’s officials for portraying the economy in bad light contrary to his government’s rosy picture.
Sign of compassion for the disadvantaged sector of society may be gleaned from how the tycoons responded to the clamor for aid of the hapless typhoon victims in the Eastern Visayas region.
While some, particularly Sy and Tan, handed out P100 million each, others were hardly in the news, apparently opting to work behind the scene with less fanfare.
Billionaire port king Enrique Razon deployed heavy equipment to repair the damaged piers in Tacloban city and Leyte, while the Ayalas and banker George Ty chipped in P10 million and P50 million, respectively, worth of relief supplies.
The cost of putting the typhoon-ravaged Eastern Visayas region back on its feet amounts to a whopping P250 billion, a window of opportunity for the tycoons to share their wealth with those they derived their profits from.
Overall, while there is evidence of progress in addressing the yawning rich-poor gap, it is too slow. One study says it would take dozens of decade for the bottom millions of the nation’s population to achieve 10 per cent of the national income under the current rate of change.
Similarly, it raises questions about the Philippines’ pro-capitalist economic model vis-à-vis the egalitarian-oriented socialist type.
- Philippines’ Aquino Races the World’s Fastest Economies – Bloomberg (bloomberg.com)
- PH poverty almost unchanged since 2006 (rappler.com)
- After Typhoon Recovery, Philippines Needs Jobs – Bloomberg (bloomberg.com)
- The Grim Reality Behind the Philippines’ Economic Growth – Jillian Keenan – The Atlantic (theatlantic.com)
- Country slow to reduce poverty despite dramatic growth (hispanicbusiness.com)
- Divided Filipinos (ireport.cnn.com)
- The Philippine Economy in the Aftermath of Haiyan (live.wsj.com)
- GILLES GARACHON : Promoting French Tourism in the PH (opinyon2010.wordpress.com)
- Philippines Has More to Fix Than Typhoon Damage – Bloomberg (bloomberg.com)
- Government: Poverty reduction slow, threatens MDGs (businessmirror.com.ph)